Cuba: more reliant on the US than ever

Cuba: more reliant on the US than ever
ROBERTO ÁLVAREZ QUIÑONES | Los Ángeles | 27 de Marzo de 2017 – 16:38 CEST.

The best way to appreciate how that Cuba’s economy today depends on the
US more than ever before in its history is to engage in a very simple
mental exercise: imagine that Washington banned travel, remittances and
packages to the island, except for medicines and special visits by
Cubans to see very sick relatives.

What would happen? Can anyone even make a coherent assessment of a
scenario like this? Many shudder at even the notion. This is not going
to happen, but the mere thought places many’s hair on end – especially
that of the Castroist political and military elite. Political science
also encompasses possible situations and potential scenarios.

For 60 years the regime’s propaganda has been vociferously claiming that
before 1959 Cuba was a pseudo-colony of the US. Of course, media and
academic centers on the island have been prohibited from researching or
publishing anything about how, in fact, “revolutionary” Cuba was much
more dependent on the USSR than “bourgeois” Cuba ever was on the US.
And, what’s worse, now it depends more than ever on American cash,
especially in the wake of the devastating economic crisis in Venezuela.

Hypocrisy in the regime’s realpolitik and its two-faced policies are
evident. On the one hand, it waves the flag and stirs up enmity against
the “Empire” and the “criminal blockade”, while simultaneously
supplicating, wheeling and dealing, and spreading its tentacles behind
the scenes, both in political circles on the left, and within the US
business community, to encourage travel and commercial flights to Cuba,
and for Congress to lift the embargo so that they can obtain access to
international loans and foreign investment.

The latter, getting loans, cash and investments, is vital to the dictator and his military junta. The plans of the Government and elite
of the Communist Party (PCC) to pass power to a new generation of
leaders, military and civilians, starting in 2018, call for stabilizing
financial support that they currently lack.

More American money than ever

Between remittances, packages and trips to Cuba from the US, in 2016
Cuba brought in more than 7 billion dollars. According to experts that
figure has already surpassed the amount from Venezuelan subsidies. It is
triple the revenue from the Cuban tourist industry, almost double the
value of Cuban exports in 2016, which did not reach 4 billion, and 15
times the value of sugar exports. Incidentally, this last harvest in
2016 yielded only one third of the sugar produced back in 1925 (5.1
million tons).

From 1902 to 1958, although nearly 80% of Cuban sugar was exported to
the US (at rates higher than those on the world market) and the rest of
the Island’s trade was largely with its northern neighbor, there were
two big differences to the situation today:

There were not, as there are today, almost 2,000,000 Cubans in the US,
furnishing the country with more money than all of Cuba’s exports,
including sugar, nickel, tobacco, rum and pharmaceutical products,
combined. The funds obtained from goods exported from the island in 2016
came to half of total monies received from the US.
There were private enterprises in Cuba that generated the bulk of its Gross Domestic Product (GDP), for a per capita GDP higher than Spain’s
and almost equal to that of Italy.
Genetic parasitism

The problem is that, unlike a market economy, Cuba’s is parasitic, due
to the congenital defect of its Marxist-Leninist statism, which is
contrary to human nature, such that it can only work if it is subsidized
from abroad; first by Moscow, and then by Caracas. Now, with the crisis
in Venezuela, the Cuban economy is sustained by “counterrevolutionaries”
in Miami. The profound irony is that the cash that meets most of Cuba’s
needs today is “imperialist” in origin.

This had never happened before. According to official figures, in the
50s the US acquired 57% of Cuba’s total exports. That is, the Island
sold almost half of its exportable goods to the rest of the world,
including cattle, coffee, pineapple and other products that the country
was later unable to export when the Castros rose to power. In that
pre-Castro decade Cuba produced 60,000 tons of coffee annually. In 2016
it produced a grand total of 5,687 tons. Incredible, but true.

With regards to dependence on the USSR, renowned Cuban economist
Professor Carmelo Mesa-Lago offers some impressive figures. In 1989,
Cuba received from the Soviet Union (and, to a far lesser degree, other
allied countries) 98% of its oil, 80% of its machinery, 57% of its
chemicals, and 53% of its food. 78.6% of all imports also came from
those Communist nations.

According to the few official figures available in this regard, since
Cuba joined the Council for Mutual Economic Assistance (CMEA) in 1972,
between 75 and 80% of its total trade (exports and imports) was with the
USSR and other Communist countries. The highpoint occurred between 1984
and 1991, during the zenith of Soviet subsidies, when Moscow paid Castro
45 cents for a pound of sugar – while the price on the world market was
at 4 or 5.

What few people know around the world is that Cuba got the lion’s share
of these supplies for free, as it never paid its huge trade deficits. In
fact, it racked up a debt of 35 billion dollars with Moscow. 90% was
pardoned in 2014 by Vladimir Putin, aware that they would never collect.
He did try to force Castro to pay at least 3.5 billion, however. But
he’s not going to get a penny.

I still have a yellowing paper teletype, an AFP report from back in
1995, indicating that between 1984 and 1991 Cuba had accumulated a trade
deficit of more than 16.08 billion dollars during those 8 years, an
average of over 2 billion per year, with a spike to 2.74 billion in
1989. And almost all that unbalanced trade was with the USSR.

Total subordination

Furthermore, the island received billions of dollars in weapons of every
type: planes, tanks, artillery, ships, rockets, vehicles, guns, and
equipment, allowing it to wield the largest and most powerful army in
Latin America after Brazil. Cuba even received 42 nuclear missiles (able
to reach Washington and New York), which put the world on the brink of
nuclear war in 1962.

But what takes the cake is that in the 80s (until 1986), then Economy
Minister Humberto Perez told me, off the record, that Moscow was selling
to capitalist countries almost three million tons of crude oil that Cuba
did not use, from its annual quota allocated by the CMEA, and then
sending the money to Havana, these funds exceeding the amount generated
by all its sugar mills.

We can clearly see that Cuba was not a pseudocolony of the USSR, but an
outright one, as we can add that the largest apparatus for intelligence
and repression in Latin America, the Castros’, was organized and trained
by the KGB, with the help of East Germany’s neo-Nazi Stasi. All for free.

Despite its trade dependence on the US before 1959, Cuba was never as
subordinate to its northern neighbor as it was later on the USSR, 19,000
km away, beyond the Mediterranean.

Given the parasitism endemic to Castroist socialism, Cuba today depends
on the US so profoundly that if the scenario described at the outset of
this article were to come to pass, the nation would come to an utter
standstill. It would be another Cambodia, with people eating out of
communal pots. Without “Yankee” money, Castroism would be unsustainable.

*In an earlier version of this text the caption stated that the image
was from Havana. The picture was, in fact, taken in Washington, DC.

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